Re: Anadigics at CS International
posted on
Jan 05, 2016 01:26PM
Anadigics last conference call is a good read for those who haven't read it before.
"Now turning our attention to core from core infrastructure to our VCSEL initiative, we are pleased with the progress we’ve made so far this year. While we were modeling VCSELs to represent only 1% or 2% of total revenue this year, we are seeing a steady increase in activity and anticipate a ramp in production during 2016.
During the first half of 2015, we recognized revenue from NRE contracts that funded product development. We expect this will be ongoing as we add new partners.
During the second half of 2015, we’re scheduled to initiate shipments of qualified devices to some of our partners. From there, we expect we will ship pre-production volumes during early 2016 before moving to full production later in that year.
Due to NDA agreements we have with our partners, I can’t provide you with much more color. However, I can say that we are partnered with some very large companies. It’s important to understand as the substantial economic advantages of our 6-inch wafer process and that it’s enabling the market opportunities that our partners see. And if our partner is all right, the market opportunities are very significant.
Lastly, we are exploring the expansion of specialized foundry services to include more than just VCSELs. As noted earlier, the wafer demand on the factory drops as mobile declines, even as we grow our infrastructure business long-term.
The wafer fab is a powerful asset but it’s essential to both our core business and our VCSEL initiative. Since we have certain proprietary technologies in our fab that we consider unique, we’ve been approached by several potential customers looking to take advantage of that to make products for a variety of end markets.
As a result, this may lead to expanded foundry service revenues. Beyond having the potential to improve our cash flow, this strategy also helps us absorb rapidly absorb fixed cost. While it is too soon for us to provide any forecasts, we believe that this strategy has the potential to provide a meaningful contribution to our revenue and gross margin expansion within a year or so."
The bold and underlined is mine.